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European HR coil prices are hitting record highs, both in the north and south of the continent. The average transaction value in the MEPS region for March was 753 Euro/ton. This compares with the highest figure of 791 Euro/tonne recorded in August 2008.

Difficulties in purchasing raw materials

After the recession in February, prices have recovered their momentum. The full implementation of the hikes announced by major domestic steelmakers will cause the previous record high value to be surpassed.

Buyers of strip rolling products report continued difficulties in purchasing raw materials. In particular, galvanized steel coil and sheet are in short supply. Despite fluctuating scrap prices, the expectation of steel shortage in the future maintains upward pressure on prices.

Production in ArcelorMittal Italy remains limited. The imminent threat of a hot store closure at Taranto’s works eased. Liberty Steel’s concerns over reliability, following the demise of their financial aid firm, add to market uncertainty.

Delivery time for flat products, except for thick sheet steel, is currently extended until 3Q2021. Offers are limited to contract trading and frequent customers. This pattern is repeated throughout the supply chain.

The auto industry remains a key consumer industry. However, the semiconductor shortage is limiting vehicle output.

Spring weather drives the long steel market

Long steel product buyers report good availability from mills. However, manufacturers recommend that the production output has to be pre-set. However, there is still output for more bookings.

Rebar prices fell further in March after international scrap prices weakened. The decline was more noticeable in Southern Europe than in the North. The transaction value of Spain was 100 Euro/ton lower than the price in Germany. Italian rebar prices have less obvious differences but still, there is a significant difference.

Construction and housing activities are scheduled to take place in the spring. The post-Covid-19 government’s fiscal recovery plans will stimulate demand. In contrast, a number of existing projects, planned with lower input costs, have been stalled, following recent sharp increases in steel prices. A potential third wave of coronavirus may also inhibit growth in the short term.

The EC reviews protective measures

European steel consumers have been more vocal against the current safeguard measures. They say the shortage of raw materials in the EU demonstrates the need for a healthy import market.

However, given the current capital flow rate, the quota volume for all products studied by MEPS is forecasted to be underutilized by the end of the quarter.

Import quotas have been exhausted for a number of countries. Self-defense limits for other materials, such as perforated steel from Turkey, were exceeded during the first days of January.

These factors will form part of the European Commission’s consideration process when the European Commission considers safeguard measures.


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